Value is always arbitrarily based on what someone is willing to pay to own something. All investing is trying to increase the amount someone is willing to pay for something. Traditionally, stock prices have been based off future earnings potential. Where this gets tricky is that companies these days rarely give you this money back, they generally reinvest in order to create more value for the owners, hence the stock of the price increases as the earnings are reinvested in order to give it a greater future earnings potential.

This odd system without actual dividends paid out mainly comes from the doubble taxation of corporate earnings when they're paid out to investors.

So all stock prices are based on the rampant speculation that the company will earn money in the future.

Matthew